Taoiseach Leo Varadkar has said that there will be a clampdown on people who are asked to return to work but refuse in order to keep receiving the pandemic unemployment payment (PUP).

Speaking on this morning's Newstalk Breakfast programme, he said that if a person is offered their job back after the pandemic but refuse to take it, they will lose eligibility.

"If somebody is offered their job back and they refuse to take their job back, they lose eligibility for the payment,” he said.

"We will need to do a bit of enforcement around that but before we start to do any of these things, we wanted to make sure that people could actually [live]."

He also added that it is "not fair" and "not sustainable" that some people may be earning more from the PUP than in their jobs, such as students who previously worked a shift a week.

He said that this happened due to decisions being made quickly.

"We said the best thing to do would be to give everyone maybe 70pc or 80pc of their previous income and, with that volume of people losing their jobs so quickly, we worked out within hours that it would take weeks to administer that and half a million people would have been left with little or no money for a very long period time."

The Fine Gael leader added that if the virus remains under control and "all things remain equal", schools will reopen in September.

"There is the risk of the virus coming back again and spreading again," he said.

"It’s not intended that schools will open until September but we are looking at how we’re going to do that now and it does require a bit of planning.

"There’s never going to be 100pc no risk unfortunately.

"There’s no no risk option but we have to look at all the ways we can minimise risk," he added.

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Mr Varadkar added that childcare centres will reopen in June for children with disabilities who may be regressing at home.

"Another area that a lot of work is going it to now is childcare, to start opening childcare centres at the end of June, not for all kids but in phases.

"One particular area which we would really like to do something on is children with special needs," he said.

He added that he "of course" worries about the Irish government being too conservative in the easing of lockdown restrictions.

"We’re very conscious of this issue of secondary deaths and that people don’t die with or of Covid but die as a consequence of some of the decisions that we have to take to get Covid under control.

"The longer this goes on the more severe the impact is on the economy," he said.

The Taoiseach added that he hasn’t experienced much difficulty sleeping amid the stress of leading the country through a pandemic.

"I’ve always been able to sleep well, I wouldn’t mind a few more hours but I can always get to sleep," he said.

He added that he feels "lucky" to have a job and that his problems "pale in significance" to those of people who may have lost jobs or loved ones due to the virus.

Meanwhile, Mr Varadkar has said Ireland doesn't need "to be the best boys in the fiscal class" as the State borrows to fund coronavirus recovery.

But he also warned that there's "no such thing as free money".

His remarks came in the Dáil as he told TDs that the crisis has "dealt a severe shock to our economy" listing "record-breaking levels of unemployment" and "lower living standards for many".

He said that social distancing may see a rise in the cost of public services and infrastructure and "it might cost us more to do less".

Mr Varadkar said the recovery will not be easy and is unlikely to be led by exports, agri-food, tourism and multinationals due to the global nature of the recession.

He also said that Brexit will "further complicates matters".

One upside is that Ireland is not shut out of the money markets as it was 12 years ago.

"This time, we can afford to borrow to reflate our economy at low interest rates, and with little conditionality.

"We're doing so. And we should continue to do so," Mr Varadkar said.

He said there will be a substantial budget deficit this year and for several years to come which will increase national debt.

Borrowed money will pay for social welfare supports, the reopening of the country, retraining of workers and stimulating economic activity.

Mr Varadkar said: "We should continue to borrow until the economy returns to sustained growth" and after that seek to reduce it and try to achieve a broadly balanced budget again within a few years.

"We do not need to be the best boys in the fiscal class.

"But we should seek to run deficits similar to those of our peers in Northern Europe, not much larger ones," he said adding: "This is a sensible, and sustainable thing to do."

Mr Varadkar said he is concerned at a growing belief that the country can borrow cheaply forever and "this is the solution to all our problems.

"It's the free money argument, and it's coming from the right as well as the left but there is no such thing as free money."

He warned debt has to be serviced and even if it's rolled over, it would be our children and grandchildren that end up paying.

Mr Varadkar said: "The next government whenever it takes office will have to sail the ship of state through the hardest of rocks and the toughs of hard places.

"It can be done but it won’t be easy."

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